SEC Approves Amendments to FINRA Corporate Financing Rule
On May 15th, the Financial Industry Regulatory Authority announced SEC approval of amendments to FINRA Rule 5110 (Corporate Financing Rule-Underwriting Terms and Arrangements). The amendments expand the circumstances in which termination fees and rights of first refusal are permissible; exempt from the filing requirements certain collective investment vehicles that are not registered as investment companies; and make clarifying, non-substantive changes regarding documents filed through FINRA’s electronic filing system. The amendments are effective immediately. FINRA Regulatory Notice 14-22.
SEC Approves Amendments to Equity Trade Reporting and OATS Rules
On May 15th, the Financial Industry Regulatory Authority announced SEC approval of amendments to FINRA rules governing the reporting of (i) over-the-counter transactions in equity securities to the FINRA facilities; and (ii) orders in NMS stocks and OTC equity securities to the Order Audit Trail System (“OATS”). The OATS amendments were implemented April 7, 2014, and the ORF amendments will be implemented September 15, 2014. The implementation date for the requirement relating to reporting in milliseconds to the ADF and TRFs is September 29, 2014. The implementation date for the remainder of the ADF and TRF amendments will be announced separately and will be during the first quarter of 2015. FINRA Regulatory Notice 14-21.
SEC “Understands” FINRA
On May 15th, Reuters noted the comments of Andrew Ceresney, Director of the SEC’s Enforcement Division, concerning the Financial Industry Regulatory Authority’s apparent reluctance to require respondents in enforcement actions to admit wrongdoing. Ceresney said that he “understood” the FINRA’s position. Understanding.
Changes to “Tied Stock” Rules Proposed
On May 13th, the SEC provided notice of the Chicago Board Options Exchange’s filing of a proposal to add rules regarding orders that are tied to stock, including a proposed definition of tied to stock orders and a related reporting requirement. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of May 19. SEC Release No. 34- 72154.